African Development Bank (AfDB)

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The head of the African Development Bank is calling for an end to loans given in exchange for the continent’s rich supplies of oil or critical minerals used in smartphones and electric car batteries.

About African Development Bank (AfDB)

  • It is a regional multilateral development finance institution established to contribute to the economic development and social progress of African countries–the institution's regional member countries. 
  • The bank is also known as the Banque Africaine de Développement.
  • It was founded following an agreement signed by member states in 1963 in Khartoum, Sudan, which became effective in 1964.
  • Mission: To help reduce poverty, improve living conditions for Africans, and mobilize resources for the continent’s economic and social development.
  • AfDB seeks to stimulate and mobilize internal and external resources to promote investments as well as provide its regional member countries with technical and financial assistance.
  • It is a financial provider to African governments and private companies investing in the Bank’s regional member countries.
  • Headquarters: Abidjan, Côte d’Ivoire
  • The AfDB Bank Group comprises three entities: the African Development Bank, the African Development Fund (ADF), and the Nigeria Trust Fund (NTF).
    • While the AfDB issues loans to African middle-income countries, the ADF supports countries that do not have sufficient resources to benefit from regular AfDB financing. These countries are offered interest-free loans and grants to finance sustainable development.
    • The NTF was founded in 1976 with capital from Nigeria. It provides cofinancing for AfDB measures and financing for NTF-specific measures in the public and private sectors in low-income member countries.
  • Membership: It has 81 member countries: 54 from the African continent and the other 27 from other regions around the world.
  • Shareholding:
    • The shareholding of the Bank is 60%-40% between regional member countries and non-regional member countries respectively.
    • Nigeria is the largest shareholder of AfDB.

Q1) What is the Asian Development Bank (ADB)?

Asian Development Bank is a multilateral development bank established on 19th December 1966. It assists members and partners by providing loans, technical assistance, grants, and equity investments to promote social and economic development. It also provides financing to certain private sector projects as well as public-private partnerships. It encompasses 68 members—of which 49 are from within Asia and the Pacific and 19 outside.

Source: African Development Bank chief criticizes opaque loans tied to Africa’s natural resources